Ok so say I have a guitar with a lifetime warranty, and something goes wrong with it. Something electrical etc etc etc. Do the guitar companies have dedicated shops that you would then take the guitar to OR do they have you ship it in?
Check with the local guitar shops around you that do repairs, and ask if they do warranty work for your particular guitar.

Some shops are authorized, others aren't. And in some cases, you may have to ship it off.
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I'm going to have to find a shop then because Shipping costs on a Guitar would be absolutely insane.
Gibson's warrenties are crap. You have to take it back to the dealer and the list of covered repairs is very restrictive. Some other companies may be more liberal. For cheaper guitars sometimes the best route (if still new) is a direct exchange. Read the warranty info on any guitar you wish to purchase very carefully. Most important is : Do I have to mail the guitar back in or can a dealer or any qualified music store do the repair? Make sure you understand the definition of "a qualified service technician."
Fender Musical Instruments (FMIC) is very good with warranty and warranty work from what I hear (and with the issues with Jackson and Charvel USAs, I think thats a good thing). You have to take it to an authorized shop though or have it sent off. If its sent off through a shop, I don't believe you have to pay. However, its important to note, the only things covered in life time is the actual construction of the guitar, and nothing else (frets, electronics, etc). Its also easy to void, so be sure to read the terms.